BD has found a new home for its biosciences and diagnostics divisions at the lab equipment maker Waters Corporation, through a transaction valued at $17.5 billion that ranks it as one of the largest acquisitions of the year so far.
The combined units—which brought in about $3.4 billion of revenue in 2024—were put up for sale or spinoff in February as BD aims to focus its efforts on delivering essential medical supplies and drug delivery hardware, through the culmination of its five-year plan to reshape the company into more of a pure-play enterprise.
The deal, structured as a reverse Morris trust, will allow BD to avoid paying taxes on what would otherwise be a direct sale of its assets. Technically, BD will move forward with plans to spin out its units as an independent company, which will then simultaneously be combined with a Waters-owned subsidiary.
Waters and BD shareholders are set to split ownership of the new outfit at about 60-40, respectively, while BD will also receive about $4 billion in cash—money the company expects to spend at least half of on buying back shares, with the remainder going toward paying down its debts.
The deal’s mammoth $17.5 billion total accounts for the stock that BD shareholders will control following the closure of the deal, which is slated for the first quarter of 2026.
For 2025, the to-be-combined company’s portfolios and its 16,000 total employees are expected to generate about $6.5 billion in sales, aimed largely at high-volume testing and regulated settings—such as biopharma quality assurance, molecular diagnostics and infectious disease monitoring, as well as food and environmental testing.
Waters estimates the deal will double its total addressable market to about $40 billion, with between 5% and 7% annual growth thereafter—driven by about 70% of its revenue mix being linked to consumables and recurring sales, in part tied to inheriting an installed base of more than 25,000 BD flow cytometry machines and over 40,000 diagnostic instruments worldwide.
Meanwhile, Waters touts an analysis and informatics platform that it says is employed in about 80% of all novel drug submissions delivered to regulators in the U.S., Europe and China, alongside its mass spec and liquid chromatography systems.
The companies also projected about $200 million in cost synergies within three years.
“This is absolutely a perfect fit,” Waters President and CEO Udit Batra said on a call with investors. “Here comes BD with 70,000 more instruments, placed in every laboratory around the globe—and 20,000 are due for replacement in the next two years. We’re chomping at the bit to get going.”
Batra also pitched opportunities in service plan attachment and e-commerce expansions, while working in “high-growth adjacencies such as bioseparations, bioanalytical characterization, and multiplex diagnostics.”
Wall Street, however, appeared skeptical. Waters’ stock price dropped by more than 13% in the morning following the announcement, to about $304.50, while BD shares dipped by about 1% to $174.40. Waters has scheduled its second-quarter earnings release for August 4.
“We are bringing together complementary portfolios and channels that create an industry-leading life science and diagnostics company,” BD President and CEO Tom Polen said in a statement. “We see an incredible opportunity to leverage both companies' commitments to unparalleled innovation, technology, and commercial presence to serve attractive high-growth end-markets, while simultaneously unlocking multiple new growth vectors.”
“We couldn't be more confident that the combined company, under Udit's leadership, represents the best path to create substantial value for shareholders,” Polen said. “Waters offers the right cultural fit for our Biosciences & Diagnostic Solutions associates to flourish and continue their legacy of developing new-to-world, innovative solutions that make a meaningful impact on global healthcare.”